Customers lose out as mobile phone firm Excell enters administration

Customers left out of pocket by the collapse of a Telford mobile phone cashback firm have been warned not to expect pay-outs.

Excell Communications (Shropshire) went into administration before Christmas, with insolvency firm Begbies Traynor called into handle the case.

According to the administrators, Excell offered mobile phone customers discounted rates through what was described as a “cashback redemption,” which meant customers were sent cheques on a monthly basis.

However, problems at the company have prompted many former customers to share their experiences online, with claims that 5,000 people have been affected by the collapse and several commenting that they have been left hundreds of pounds out of pocket.

Begbies Traynor said it was not in a position to confirm the number of customers affected by Excell’s administration or to say how many people worked at the company when it went under.

The move to place Excell into administration came as a surprise to many, as earlier in the year it had painted an upbeat picture of its business.

The firm announced in the summer that it was moving to new offices in Technology House in Telford, creating more than 50 new jobs.

The company said at the time that it had had a “very successful 2009” and that it was bucking economic trends.

But that success appeared to come to an end when the firm was taken into the hands of Begbies Traynor, with David Moore and Gary Lee appointed as joint administrators.

In a statement posted on Excell’s website, Begbies Traynor said it was unlikely that sufficient funds would be found for creditors.

It states: “The company, as an incentive to attract customers to various network providers, offered discounted rates by way of a ‘cashback redemption’ arrangement which effectively meant that cheques would be sent to those customers who applied on a monthly basis for the duration of their contract.

“This arrangement was between Excell Communications (Shropshire) Limited and the customers and the line providers were not party to this arrangement.

“It may well be that there will be substantial claims lodged against Excell Communications (Shropshire) Limited for their cashback redemption agreements but the indications at present are that there will be insufficient funds available for a return to creditors.”